Sportech board throws full weight behind BetMakers takeover bid
Global pari-mutuel business and tech supplier ends talks with US hedge fund Standard General
Sportech’s board of directors has cleared the way for the $31m acquisition of the business by BetMakers, after the firm terminated rival takeover talks with US hedge fund Standard General.
Sportech, which is currently in the process of completing its due diligence on the BetMakers deal, closed the talks, less than a month after Sportech confirmed several approaches by Standard General had been made and ultimately rebuffed.
Standard General pursues a strategy of opportunistic investments in several US middle-market companies including American Apparel and Radio Shack.
The company is known for specializing in distressed debts, or companies which have either defaulted, are under bankruptcy protection, or are in financial distress and moving toward these situations in the near future.
Sportech’s share price rose by 34% on the London Stock Exchange when news of the takeover bids broke in November, with Standard General reaffirming its intention to strike a last-minute deal despite initial refusals from the firm.
This cleared the way for BetMakers to become the preferred bidder for the global pari-mutuel racing business, with BetMakers funding the purchase price through a combination of existing cash and newly issued share capital.
“After considering the full terms and conditions of Standard General’s proposal and taking into account the views of the shareholders, the board had decided that the proposal did not adequately value the businesses of Sportech,” the firm said in a statement.
The BetMakers bid will now be put to a shareholder vote by Sportech on December 21 and is expected to complete in 2021.
In Europe, Sportech operates agreements with major pari-mutuel providers including the UK Tote Group, Finland’s Veikkaus and Racecourse Media Group, as well as co-mingling agreements with 20 other Tote operators worldwide.
Sportech has seven offices across the UK, US, Ireland, Turkey, France and Germany.
It is expected that key management within the Sportech business will continue to work within the combined group’s pari-mutuel and digital businesses after the takeover completes.